IN BANKRUPTCY.

Ashburton Guardian, Volume VII, Issue 2281, 15 November 1889, Page 2

IN BANKRUPTCY.

IN Re B. W. OSBOttNK.

Motion to upset a bill of sale,

Mr Oayglll for the Deputy Offioial A-slgnoe: Mr MoOonnel, ooe of the parties to t.ho Boilen, appearing on hla own behalf.

In this oase tbe Deputy Official Aa»lgnee la the bankrupt oatate of E, W, Oaborne cought to have a bill of sulo and mortgage of fltook given by Odborne to Robert MoOonnel deoUred void aa ago.nst the Aeuignee, on the groan 'ln that the consideration for the bill wbb not set forth therein aa. required by .the Ohatt.ln Baourltlns Act, 1880, and its amendment; that tho stoo'i, chtttols and premise* ueßlgnecl -were not correotly, truly and specifically _63orlbod aa required by the Chattels S-oarHoß Aot, 1880, and Kb amendment.; and that the bill of nale and mortgage of atook was made and given ni.bjt-ct to a defo_.s_.noo not oontolned m tbo body thereof nor written thereon.

Hlb Honor now gave jadgmenfc a« follows: — This Ib an applioation by ths Dopnty-Offiolal Assignee In the estate of Osborne for an order declaring the bill of aale and mortgage of otock, dated 20. h Febreary, 1887, given by Osborne 1 to McOon.iell, to be void as against thp aaid Deputy-Oflio.al Assignee. It ap pears that Oaborno gave to tho Obrl-t---ohurch Fioanoo Compauy on tho 30th September, 188G, a bill of nale and at?tlouitun.l Ilea to secure £200. Oa July 11, 1887, tho 8»M Company assigned then© secarltiea to MoOonnell In oon aldoratlon of £71 17s 3d, which appe-.ru to have been tbe nnm then duo noor> them. Oa the 23fd Fobraary, 3886 Osborne gave to the Bank of New Zealand a certain chattol aoourlty to seoure £406, payable at oertaln fixod dates by Inutalments. The Bank on Jn'y 19, 1887, HDsigued this soonrlty to M.Oonuell m consideration of tbo «urn of £260 17« 3J, being tho amount then dao u_>on lt by Osborne. On J niy 20 1887, Osborne executed, In favour of McOonnell, a bill of srlo and mortgage of at >ck (inn subjoot of this applioation) ovor inter alia the same artioles aoeolfied io the eeaarllleß of the B»nk and Finance Company. The deed eoumora'ea a Bodea of advance*" ma^e 1/y MoO-mrel to -Oo_.__- or ou 1,„ B behalf, among which are ino'udad tho flom3 paid by the latter to tbe Bank and Flnonco 00. respectively on the assignment of thoir securities, amo-ntlnK m the whole to £710 13.. 8d which Oaborno covenant's to pay on demand. Tha deed aBO oontains a reference to •« othor socurities of evon date herewith" given for eeouring this £710, and provides specially against the merger ia it of any negotiable instrument theretofore given io respect of any of tho advanoes specified A promissory noto a f , four monlhs was produced, for tho sum of £525, part of said advances, given by Osborne to McOonnHl on the 2nd July, a wool scoarity, and also an agricultural Han, givo . by the same to the same, eaoh eppoifying ob consideration Iho gam of £710 133 Bd, boing admittedly the aame debt and amount mentioned m the bill of sale dated on the B ame day ; and it was contended that tho provision* of Clnuso 52 of the Ohattelo Saourit'es Aot, 1880, not baying been oomplied with these documents severally operated aa defeaßanoeß of tho bill of Bale, which must consequently be hold void against the Deputy Offioial Assignee, I have beon muoh impressed with the judgment of Mr Justice Donaiston in Ohrietohuroh Finance Co. v Durant, as to tho effaot of a promissory noto, bnt tho learned jadgo thero Btatea that he gives his opinion with groat douht ond hesitation, u.;d evidoatly bases it on the Bpec r al oiroumstanoeg oE that case whioh are clearly distinguishable from thoße of tho present one. Tho r-aaoning of Lord E-her— judgment m Oounsell v London and Weßtnjinßtor Loan and Diaoount Co, (19 Q.B. Div. 615) appears to me oonolusivo when applied to tho case now before the Oourt. The oontraot between Oaborno and MoOonnel dearly iB tbat the promissory noto, whioh purports on the faoe of it to have beon disoouuted, shou d m no way be invalidated by Iho bill of Bale. Assuming that tho holder for value of tbe promissory note had reqoivod payn^t of the sqm doe on it, thie would obviously have been a paypent firo tanto, of tho qaaount' epeolfied m the bill of sulo, aqd otma-naoßtly to tljat pxtßnt the p_>omlf*ory n0.6 ia a defeasance tbproof. It i 8 qnneoemary to go farther, howovor clear the other cu n ; Bn Hons may be. MoQo**-. a . , 00at0Q HnnUr«_l . J* " hlB bl, » °* B^ be decljred Void as prayed, he oan claim tho nioet valuable pirt of the chattel., comprised m iti as aasignoo qt the Bank and Finmjoo Oqrapany under tho dooda hereinbefore ranted. Thia olaim wa B not fully argued, but prima facie it wonld oeom that ftlcOonnol, standing m the plaoa of tho flank and Finance Company entered into a frosh contraot with Oaborno with roßpaot to tho Bums duo and the attloloa pledged to the original mortgagees, and that if it woro attempted to enforce by law (v olaim under the flret deeds the Bubstitutad bill of Bala might bo pleaded m answer. By tho presout ordor tho bill of sale. Oaborno to MoOonnel, is not doolared to bo wholly nail, but merely to bo void as aguint_t tho namo persons as it would have boon if not Hied m acoordanco wiih atatutory provisions. Order accordingly, coats SIO^IOb, and wltnoßßea and disbursement-.

Mr MoOonnel gave notloo of appeal.

LKTTBRB Off ADMINISTRATION. In re Joseph Buchanan, deceased— Motion for ordov granting lottora of admlolatr*tion to Edith Mary Buohanan. Mr Oathbortson appeared to oapport tho motion — ordor granted. The Court then rose.